Senior ministers have rejected calls by British business leaders for the UK to stay in the EU customs union and single market for a lengthy period after Brexit, raising fears of a bumpy transition to a new trading relationship with Europe.

The CBI employers body raised the stakes on Thursday by proposing that Britain stay inside the EU’s internal market and its trading bloc until a new trade deal between London and Brussels was put “in force” — a process which could take many years and even last beyond a 2022 election.

But Philip Hammond, the chancellor, said on Friday that any transitional deal would not involve Britain remaining a member of either the customs union or single market, even though the government would do all it could to minimise “the shock” to business.

At the same time, Brexit secretary David Davis, meeting chief executives and business groups at Chevening House in Kent, dismissed the idea of Britain enjoying a transition deal that would leave it temporarily like Norway, which is not an EU member but is inside its economic and trading blocs.

According to attendees, Mr Davis told business leaders there would be a political backlash if it looked like Britain had not really left the EU and was engaged in an open-ended transition that continued current economic arrangements.